Accounting and Financial Management: Westpac Group Reporting Analysis

This report provides a critical analysis of the external reporting practices of the Westpac Group, one of Australia's largest banking institutions. The analysis begins with an overview of the environmental and social effects of Westpac's operations, examining both positive contributions, such as financial programs and green energy projects, and potential negative impacts related to increased consumption and industrialization. The report then delves into the quality and depth of Westpac's environmental and social performance, discussing the challenges faced when applying the GRI framework and evaluating the potential benefits of compliance for stakeholders. Part B of the report outlines a strategic initiative, including a short internal briefing document, a balanced scorecard with key performance indicators across financial, customer, internal processes, and learning perspectives, and an evaluation of the initiative using break-even analysis to assess product viability. The conclusion summarizes the key findings and implications of the analysis.

Running head: ACCOUNTING AND FINANCIAL MANAGEMENT
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External Reporting Of Westpac Group and Critique of Useful Information
Name of the Student
Name of the University
Author’s Note

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Table of Contents
PART A: CRITICAL ANALYSIS..............................................................................3
Introduction.............................................................................................................3
An overview of the environmental and social effects of the operations..............3
Operations with a positive impact on the environment and the community....4
The negative impact of the operations.............................................................5
Quality and depth of the environmental and social performance........................6
Challenges faced with applying the GRI framework...........................................6
Whether compliance would benefit stakeholders................................................8
PART B: STRATEGIC INITIATIVE.........................................................................8
Short internal briefing document.........................................................................8
Balanced scorecard for a new initiative...............................................................9
A brief discussion of the key features on the scorecard................................11
Evaluating the initiative using break-even analysis...........................................12
Products need to break even.........................................................................12
Conclusion.........................................................................................................13
References........................................................................................................14

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PART A: CRITICAL ANALYSIS
Introduction
This section of the paper will majorly concentrate on assessing the information
provided by the company regarding the environmental concerns and other social
impacts that result from the firm's operations. Financial frameworks such as the GRI
(global reporting initiatives) will be used as the basis for making the analysis required in
this particular part of the paper. Summary covering the social impacts that result out of
the firm's operations challenges encountered while complying with the requirements of
the GRI framework and so on will be discussed. Evaluations regarding the possible
benefits to the different stakeholders such as investors, shareholders of the entity will be
provided.
An overview of the environmental and social effects of the operations
West Pac is one of Australia's oldest banks and it is among the four major
entities in Australia. The bank is also the largest banking institution in New Zealand
providing a wide range of consumer, business and institutional banking services among
others. In recent times, however, the bank has been involved in several operations that
have either positively or negatively affected the environment and the general community
(Nielsen and Nielsen, 2015).
Operations with a positive impact on the environment and the community
Among the most prevalent operations taken by the company is assisting various
individuals when it comes to making financial decisions. This is has been used as a way
of ensuring corporate social responsibility (Carp et al, 2018). In the long run, such an
activity will effectively rhyme with the requirements of the GRI framework thereby
ensuring sustainability. The west pac company has carried out such an operation
through activities such as making available products and services to aid customers with
decision making, implementing, financial health program, availing of financial training
among other activities. This has positively transformed the Australian community in
terms of financial knowledge and understanding. For instance, the bank through the
Davidson institute together with the managing your money program provided financial
education services to the citizens of both Australia and New Zealand.
West Pac Company limited has also undertaken various programs regarding
environmental conservation. This has made the company the largest financial provider
of different greenfield and renewable energy projects within Australia (Pro Bono News,
2013). For instance, the company lent out well over $6.2 billion in the year 2016
towards solving the problem of climate changes. This amount was increased to a total
of $ 7 billion in the following year of 2017(Chimtengo, Mkandawire and Hanif, 2017).

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From such operations, the environmental conservation has been improved and
enhanced throughout Australia and New Zealand at large.
Together with the World Bank, west pac launched development sustainable
growth bonds throughout Australia. The major beneficiaries of such bonds were the
Australian investors who were interested in providing support to sustainable
development goals (SDGs) (West Pac, 2018). The other important aspect of such
development bonds is that they were also aiming at eliminating poverty and create
opportunities for a variety of individuals. The outcomes of such an arrangement with the
World Bank would sustainably result in improved standards of living for people hence
promoting social benefit in general.
The negative impact of the operations
The negative impacts that may are likely to result out of the company’s
operations are rather indirect. This is because the company operates under guidelines
to improve and support climate change conditions of the nearby future. However some
of the projects that the bank tend to increase or promote economic consumption.
Therefore, according to the environmentalists, an increased rate of consumption would
in an economy consequently and negatively affects the environment (The World Bank,
2018). An increase in economic growth implies that there is a higher consumption level
and purchasing power, however, high levels of purchasing power and consumption,
additional pressure is exerted on to the environmental resources. Ultimately this leads
to resource depletion in the long run. Alternatively, the increased and continued funding
of electricity programs would consequently result in environmental damage in the long
run (Zimmermann, 2019). The argument from such a perspective is that when these
huge amounts of electricity are generated the outcome is increased industrialization.
The result of such an increased rate of industrialization is environmental pollution
(Korzeb and Medina, 2019).
The need for increased innovation and technological advancement is a positive
operation that should be embraced; however, the excessive technological
advancements would result in negative impacts on the social well being of humanity.
With the need to reduce operating costs, banks such as west Pac Company have over
the years adapted technology as one way of reducing costs of operations. On the
negative side, however, continued use of such technological methods of operation is
most likely to result in tendencies of unemployment for the Australian citizens and the
general public. Socially unemployment, in the long run, would increase the cost of living
and reduced purchasing power.
Quality and depth of the environmental and social performance
In the finical sector banks have played a vital duty in achieving sustainable
development programs. It is through such operations that they have led to
improvements and changes in the environment and the ecological system together with
transforming the social perspective of humanity (Fonseca, 2010). With a major
emphasis on their role of providing financial services, banks such s wets pac and others
have also taken the concern to address the need for social and environmental
requirements. this is effectively done through providing ‘financial services and as the

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same supporting external sustainable projects. It is of no doubt that the wets Pac
Company is emphasizing such sustainable projects and operations aimed at achieving
sustainability and environmental conservation (Australian Government, 2017).
Challenges faced with applying the GRI framework
The growing demand and the prevailing variety of stakeholder needs and
interests effectively resulted in the need for a wider mode of reporting and presenting
financial data and information. It is such a scenario that rendered the conventional
approach of accounting weak and unable to satisfy stakeholder needs. However,
despite its numerous benefits and importance, the GRI reporting framework has been
associated with several shortcomings. The following discussions, present a detailed
presentation of the challenges associated with the GRI reporting framework.
The framework focuses on the internal aspects of organizational performance
and less on the need for detailed and complex analyses of the existing relationship
between the organization and the external environment. The concentration on the
internal performance of the entity or organization results in exposure to several risks.
Among such risks includes disclosing information that may violate the relationship
between the entities and the surrounding environment.
The other outstanding challenge that is associated with the GRI framework is the
failure to identify the exact audience addressed. For instance, certain companies
operate in a wide range of societies that have extremely different conditions and
environment. However, the framework does not provide a clear view that specifies the
exact community of environmental surrounding being addressed. This ultimately leaves
out a large number of stakeholders’ concerns unanswered (De Burgwal and Viera,
2014).
Whether compliance would benefit stakeholders
The evaluation to assess the possible benefits of the framework are sometimes
subjected to debate. However, besides the few pronounced shortcomings associated
with the framework, there is a high possibility that the framework would generate
benefits. For example stakeholder such as the surrounding community would effectively
benefit from such disclosures required by the GRI framework (Miralles-Quiros, Miralles-
Quiros, and Goncalves, 2018). This is due t the fact that an entity will ensure that social
responsibility is enhanced since the failure to observe this would lead to business
collapse. The community and general surrounding of business entity would find it most
important to understand the general performance of the organization (Lellahom, 2013).
In so the community is majorly interested in observing and protecting the environment
and perhaps the societal gains and objectives. Therefore, the need to live in harmony
with the surrounding community would result in corporate social responsibility in the
long run.

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PART B: STRATEGIC INITIATIVE
A short internal briefing document
The briefing document is simply an insight into the aspects surrounding the new
product line. It, therefore, involves an analysis of different factors that may affect the
demand and consumption of the products to be released on the market. The briefing
document for the new product line is therefore discussed below:
The new strategic initiative to develop a range of products that the company
intends s to offer on the market will involve several activities before the actual launch on
the market. There is a need to understand the different specifications that are very vital
before in the early stages of the product. For instance, the size, the pricing strategy that
will be used, the target market and so many other variables will require assessment.
Factors such as competition from the existing products already on the market will also
be an important aspect of consideration. Therefore, the marketing and sales department
will have the duty to devise all such necessary steps before the actual launch of the
product line. Some of the possible strategies that can be used to overcome these
constraints such as the existing competitors in the market may include the use of
promotional sales. This particular strategy will require aggressive advertisements to
create market awareness.
The costs involved in promoting the product on the market will include the fixed,
variable and semi-variable costs. The variable costs, for example, are those that will
change with the level of output, the fixed, on the other hand, will remain constant
irrespective of the level of output. For instance, payments made to marketing,
managers are some of the fixed costs that may not vary with the level of sales realized.
Salaries made to the production managers a well will not depend on the level of output
and the costs of research and development will be among the fixed costs of the new
initiative. Such costs are what are classified as the fixed costs of launching a new
product line on the market. The variable costs of the initiative will, however, include the
costs of raw materials, sales commissions that may be offered to the advertising and
promotional teams, utility costs such as water and electricity and so many others.
Balanced scorecard for the new initiative
A balanced scorecard is performance measure or metric that is used by
managers when carrying out processes of identifying and improving certain internal
aspects of a business as well as the resulting external outcomes. It is, therefore, a tool
used for measuring and providing feedback to organizations concerning the activities
undertaken. A balanced scored card for the new initiative will, therefore, be developed
and it will cover four major perspectives (Munoz, Zhao, and Yang, 2017). These will
include the customer perspective, the financial perspective, the learning and growth and
lastly the internal business processes. The objectives of each of these perspectives will
as well be present ted within the scorecard template that is provided as below:
balanced scorecard
pers
pective Objective measures

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fina
ncial
to obtain
profitable market
returns and
profitability
Profitability will be measured by Lessing
costs from the revenues attained. A 10% profit
margin will be ideal. The second measure will
be the reduced cost s of operation in terms of
raw materials used and so on
cust
omer
to create a
larger market share
than the competitor
s
The measure to be used will be the
number of customer visits and royalty to the
product line. 20%increse in daily visits will be
aimed at ensuring continued success. The
customer counts and market share coverage
will as well be an important measure used.
inter
nal
processes
To be the
leading provider
and supplier of the
product line market.
This will be measured through the
number of customer feedback and demand for
the product on the market. To achieve this, a
15%annual increase will be ideal and this will
be combined with a 40% reduction in customer
complaints. The efficiency of output and
production quality to the market as per the
desired standards is another measure of
internal processes.
lear
ning and
growth
To develop
and employ a sales
team that is highly
professional and
experienced.
Customer response and service
approaches will be modified. The measure will
primarily depend upon the number of customer
complaints and feedback from the market.
Continuous research to improve customer
outreach and high-quality product delivery are
the two measures that will be used.
A brief discussion of the key features on the scorecard
A balanced scorecard is an important tool of measuring business performance
and this because it creates a reliable relationship and an interconnection between all
the four perspectives. Therefore, the financial perspective as one of the key features
majorly looks at the profitability goals and targets that the business is intending to
achieve in a specified period (Kaviani, 2014). The measurement used will be the level of
revenue obtained and subtracting the costs incurred and this will be reflected in the
financial statements. Since the customer is the source of the target revenue the
business is aiming, he or she plays a significant role. The satisfaction of the customer

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needs is one of the objectives for producing the product line. Satisfying the customer
needs wants will likewise lead to increase market share. The business processes as
another key feature specifically look at the activities that are carried out if customer
satisfaction is to be achieved. Therefore the measurement to assess whether
satisfaction is being achieved is the number of customer feedback and similarly the type
of feedback. The rate of customer feedback will be expected to increase by around 15%
and a reduction of complaints by 40% annually (Awadallah and Allam, 2015). Learning
and growth as one of the key features of the scorecard will focus on the ability to attain
sustainability.thi will therefore involve continuous market research so as to come up with
new and better way of promoting efficiency within the market and improve on the quality
of output (Jakupi et al,2017). The learning and growth, therefore, will be analyzed
through coming up with alternative methods of supplying as well as promoting more
intensive training of different individuals. With a highly trained workforce, output is much
likely to be of high quality and hence increasing market share.
Evaluating the initiative using break-even analysis
The break-even analysis is production method through which a company
produces at a point where it does not make profits nor losses (Kaplan, 2010). This
means that the revenues are equal to the costs incurred. The tool would not be highly
effective in the early stages of the initiative. This because such early points of
production, the costs are highly uncertain with on profit (Niekerk, 2015). However, in the
long, the tool would be an effective measure.
Products need to break even
In assessing the number of products to be produced, relative assumptions will be
used and such assumptions will include the target profit, fixed costs, variable costs and
the cost per unit (Bernard et al, 2015). The equation for determining the target quantity
is written as follows: TQ = FC +Tπ
CPU where;
Fc is the fixed costs
TQ is the target quantity to be produced
Cpu is the cost per unit
Tπ is the target profit.
Therefore, assuming that the company aims at a profit of $2,500 and that the
fixed costs of production are $800 and the cost per unit is $120. The number of
products to sell would be as follows: TQ = 800+2500
120 this would generate a target
quantity of 27. 5 units of output in a given period.
Conclusion
The two parts of the paper reflect a vast coverage of the financial management
professional. The GRI framework is an important system of accounting that should be
highly embraced despite the few limiting factors it is associated with. For any

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organization intending to develop a new product line of the market chronological steps
to assess the viability are a vital requirement that must be taken into consideration if
success is to be achieved in the long run.

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